Q. Did the verdict affect Asensio's license to work in
the brokerage industry?

A. Apparently not. Four years later, he
obtained a higher-level license as a broker-dealer and opened Asensio & Company.

Q. Is it unusual to be licensed as a broker-dealer
after a fraud verdict as large as this one?

A.
One would think so. The site has not been able to determine whether
precedent actually exists to grant a license under such circumstances.

Q. Might NASD have been unaware of the verdict
when it granted the
broker-dealer license?

A. Public Disclosure
files on brokers and brokerage firms are available that disclose disciplinary
events, verdicts, bankruptcies, and the like. Neither of Asensio's
files mentions the verdict.

It's possible that Asensio
reported the verdict as required, but was able to get it removed from his
NASD file after convincing a
judge to set the verdict aside. In 1998, Asensio obtained a
court order
setting the verdict aside because the process server who delivered the lawsuit
to him ten years earlier was not properly licensed.

However, it's unclear that NASD would recognize a technicality
such as this as sufficient grounds to expunge a fraud verdict from the public
disclosure file.

Simply stated, the other possibility is that Asensio concealed the verdict on
his broker-dealer application. He does deny the lawsuit elsewhere.
For example, a sworn affidavit [480 KB] signed in 2001 asserts that he has never had a customer complaint
at any time in his career (paragraph #3 of affidavit).

Q. What if the verdict was concealed from NASD before
it was set aside in 1998?

Article 3, Section 4 of the NASD
By-Laws states:

A person is subject to a
"disqualification" with respect to membership, or association with a member, if
such person:

(f) has willfully made or caused to be made in any application for membership in
a self-regulatory organization, or to become associated with a member of a
self-regulatory organization, or in any report required to be filed with a
self-regulatory organization, or in any proceeding before a self-regulatory
organization, any statement which was at the time, and in light of the
circumstances under which it was made, false or misleading with respect to any
material fact, orhas omitted to state in any such
application, report, or proceeding any material fact which is required to be
stated therein;

The By-laws also provide that:

no member shall be continued in membership if it becomes
subject to disqualification; and that no person shall be associated with a
member, continue to be associated with a member, or transfer association to
another member if such person is or becomes subject to disqualification.

The site has obtained
Asensio's application for a broker-dealer license,
which was filed four years after the Murphy verdict. It shows he answered
no when asked if a court had ever ruled against him on an investment-related matter.